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Entrepreneurial Strategy

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ENFB71-104 Entrepreneurship and Innovation

Session 3: Entrepreneurial Strategy
Baden U’Ren buren@bond.edu.au Level 4, Room 9 5595 2212

Overview
 Review of the readings  Innovation and Entrepreneurship  Entrepreneurship in a Corporate Context  Entrepreneurial Strategy

What is Innovation?

Something NEW that creates VALUE

What is Innovation?
“Innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or service. It is capable of being presented as a discipline, capable of being learned, capable of being practiced” - Peter Drucker

Source: Schaper & Volery (2007) Entrepreneurship and Small Business 2nd Edition. Wiley. p.69

 Creativity
 ideas, concepts & inventions

 Innovation
 the process of development and commercialisation

 Entrepreneurship
 couples opportunities and resources

Innovation

Exploit Incremental

Explore Radical

Kirzner
The producer-entrepreneur •Alert and responsive to opportunities that exist •Exploits disorder (gaps) to move the market back to equilibrium

Schumpeter
The innovator-entrepreneur: •Creates products and processes to disturb market equilibrium •Creates opportunities

Innovation & Performance
Some ‘stylised facts’ about the relationships between innovation and performance:  Relationships between R&D, patents, new products and performance are strongest at the industry level, weakest at the firm level  Returns from process innovation are typically four times those from product innovation  R&D expenditure stronger than patents in predicting performance

Innovation & Performance
 At firm level, R&D and new products both associated with higher value-added and market to book values  Returns from use of new technology higher than from its generation

Sources: J. Bessant & J. Tidd (2007) Innovation and…...

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